iras consultation paper dialogue session on gst: digital token

Dialogue session at 80RR Fintech Hub SG, to help provide feedback on the Inland Revenue Authority of Singapore (IRAS) consultation paper on GST: Digital Payment Tokens. Under the current rules, the supply of digital payment tokens is treated as a taxable supply of services. Therefore, the sale, issue or transfer of such tokens for consideration by a GST-registered business is subject to GST. When the tokens are used as payment for the purchase of goods or services, a barter trade resulting in two separate supplies arises — a taxable supply of the tokens and a supply of the goods or services. From 1 Jan 2020, to better reflect the characteristics of digital payment tokens, the following changes will take effect: (i) The use of digital payment tokens as payment for goods or services will not give rise to a supply of those tokens; and (ii) The exchange of digital payment tokens for fiat currency or other digital payment tokens will be exempt from GST. This paper involves discussions on GST treatment for transactions involving virtual currencies/cryptocurrencies that function or are intended to function as medium of exchange.